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The High Cost of Leaving

Skolnick wasted no time sending letters to all his tenants. So far, three more have accepted buyouts. "This is a win-win situation," he adds.

It's a familiar formula to Kevin Singleton, general manager of Rockrose Development, whose 1,000 or so rent-regulated apartments make up about a quarter of its inventory. "We regularly talk to our regulated tenants about the possibilities of a buyout," he says. Between moving costs and other services, he estimates, tenants get between $20,000 and $50,000 to walk away.

In non-demolition situations, Aby Rosen also pays up to $50,000 to reclaim an apartment in RFR's inventory of 1,000 or so rent-regulated units. "We also pay relocation costs and moving expenses," he says. "With older people, we sometimes help move them into an old-age home."

The New York State Tenants & Neighbors Coalition surmises that a few thousand rent-regulated apartments are deregulated each year. How many of these spring from buyouts? Since neither tenants nor landlords benefit from publicizing settlements, the terms -- even their existence -- often remain private. "I don't do these deals without confidentiality agreements," says Robert Goldstein of Borah Goldstein Altschuler & Schwartz, one of the city's biggest landlord firms. "You don't want the tenant telling other tenants how much you gave -- whether it's high or low."

Which means, quite possibly, that once rent regulation gives up the ghost in Manhattan, none of us will hear about it.

The application to tear down 823 Park has languished in the halls of the state Division of Housing and Community Renewal (DHCR) for five years now. David Rozenholc has contested it from several different angles, forcing the developer to make many of his business records public. In May, a dozen of the tenants had the pleasure of watching Robert Manocherian squirm under cross-examination -- as their lawyer all but accused him of falsifying documents to conceal his uncle Fred's involvement in the project. (Rozenholc still isn't really sure why Robert wanted to shield Fred this way.)

When your boiler is, at best, unreliable and your lawyer charges $300 an hour, a squirming landlord is only a modest consolation. In the past five years, tenants have been denied roof access and basement storage space; the aging lobby, just steps from East 75th Street, has grown shabbier. The façade's bricks are crumbling, leaving steel beams exposed to the rain. Mercia Bross, 71, has lived for 30 years at 823 Park with her husband, who is now fighting cancer. As the fight drags on, she's started thinking about the cost of a new apartment. "I'm worried," she says, "because prices are going through the ceiling."

"This is a kind of Homeric saga," says tenant-association co-chair David Redden. "My next-door neighbor is well into her nineties. She's lived here since the forties. This is not a game."

Rozenholc has not yet advised his clients to take money to leave. But if his track record counts for anything, down the road he could make these tenants very, very rich. "People think we're ripping off the capitalists?" he barks. "The truth is, we're not ripping them off enough."